Goldman Sachs charged with fraud

From NBC's Mark MurrayThe conventional wisdom is that this news will make it more difficult for Senate Republicans to oppose financial/Wall Street reform. In fact, NBC's Chuck Todd just said that some Democrats are comparing it to the news -- before health care's passage -- that Anthem Blue Cross raised its health premiums by 39%.

The Securities and Exchange Commission on Friday charged Goldman Sachs Group Inc. with defrauding investors, alleging that Goldman let a big hedge fund fill a financial product with risky subprime mortgages and then failed to disclose that to the product's buyers.

The SEC's civil lawsuit is one of the biggest moves by authorities in response to the financial crisis of 2007-08, and it sent Goldman shares sharply lower. The firm's shares were down about 12% around midday, and the Dow Jones Industrial Average was off more than 1%.

In a statement, Goldman said, "The SEC's charges are completely unfounded in law and fact and we will vigorously contest them and defend the firm and its reputation."